Post-Brexit Europe: Possible end of closer union and its impact on Turkey

KLAUS JURGENS

Published15.03.201821:37

Updated16.03.201800:53

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Students of European politics, government or international relations enrolled in universities around the mid 1990's will most likely remember a rather influential book written by Desmond Dinan hitting the shelves and seminar rooms en masse: "Ever Closer Union — An Introduction to European Integration." On the one hand, Euroskeptics at the time stressed its suggestive title and labeled it a pro-EU super-state. Europhiles lauded the very same header, implying that once a reference highlights such words it must be a worthwhile read. It is always important to not judge a book by its cover though, and interestingly enough, it was none of the above. Instead, it expertly covered EU history, explained how its institutions work and introduced its core policymaking approaches — of which there were and are many.

Trade shows EU's importance, Brexit potential

Today in 2018, we live in the age of Brexit. While there were always Euroskeptics in Britain before and when Dinan's book came out, they are not nearly as organized two decades later. The debate intensified up to the day David Cameron decided to let the referendum go ahead — a move that will probably go down in political history as one of the greatest miscalculations of any Western European leader serving as prime minister. He was certain the majority would vote to remain.

Now, Brexit is scheduled for either March 2019 or if an intermediate phase to complete all necessary proceedings is approved, no later than March 2021. Up until then, both a hard and soft Brexit are still possible. If no accord is reached in a sense of a Comprehensive Economic Trade Agreement (CETA) between the remaining EU member states and the U.K., World Trade Organization (WTO) rules could come back into force which — including between 3 and 5 percent in new tariffs — seems to be the worst-case scenario. Yes, those extra charges might be waived but not the related red tape and thus loss of transit time.

Please allow for some number crunching before returning to more political reflections. As some of the sources consulted use U.S. dollars, we should keep today's dollar-euro exchange rate of 0.81 in mind.

Let us take a brief look at the U.K. itself, at a candidate country to the EU — Turkey and at Central and Eastern Europe (CEE). Here four countries apart from EU members have agreed to foster their own mini-union, the Visegrad Four.

In 2016, the U.K. recorded a total of 590 billion euros in imports and 318 billion euros in trade with the other EU countries. At the same time, London recorded exports totaling 547 billion euros, with 235 billion of the total stemming from within the EU.

Seen from a bilateral perspective between the U.K. and Turkey, trade reached a volume of $17 billion in 2016 with $11.7 billion worth of exports and $5.3 billion worth of imports — a 6.3 percent rise from 2015. Very interesting, too, is the related fact that the U.K. was number two for Turkey's exports and occupied 11th place for imports from Turkey.

This is where Visegrad Group dynamics may come into play. It may sound far-fetched at first, but please let me explain. Let's face it, who would have thought Brexit could ever really happen?

The Visegrad Group consists of four nations — Slovakia, the Czech Republic, Poland and Hungary — set up in 1991 to deal with political, military, economic, energy and cultural issues. Its aim is to foster internal cooperation and after the countries became full EU members in the year 2004, to further work toward advancing integration within the EU itself. The CEE region is of course much bigger, but a choice had to be made for sake of clarity.

The Iberian Peninsula concept is different. Relations between Ireland and the U.K. are not comparable. Then, there is the Nordic Council comprised of Sweden, Finland, Denmark, Iceland and Norway, yet the latter two are not members of the EU. Intra-EU, the Visegrad Group is thus a unique type of organization and a unique form of cooperation. We should not be saying it wants to be an alternative to the EU. On the contrary, it wants to make the EU work even better, which it may create the interesting side effects discussed below.

To complete this number section, it is interesting to note that trade between Turkey and the Visegrad Group totaled $12.5 billion in 2016, with Poland topping the list with almost $6 billion.

The reason for mentioning this data is to underline two things. First, post-Brexit — an event certain to happen since a second referendum is all but impossible —Britain and Europe will not stop trading with each other. There will be diplomatic relations of course. The only question is according to which formulas. Please note the WTO comment above.

Second, a very interesting add-on effect of the post-Brexit world is whether or not a candidate country, or a country with a customs union deal, for example Turkey, could freely negotiate its own free trade agreement with the U.K.

Hence is the "ever closer union" obsolete?

Looking ahead to the initial post-Brexit years, not too many upheavals are expected in the EU itself. Everyone will play a kind of wait-and-see game. What is much more interesting though is the period from approximately 2023 on. Let me tell you how one could possibly arrive at this conclusion. The year 2023 marks the first two years after a prolonged Brexit or already four years after a 2019 exit. Enough time to take stock in Europe and around the world.

Besides, 2023 marks the centenary of the Republic of Turkey. One might assume that by that date Brussels would have either wholeheartedly welcomed Turkey with a fixed date for EU accession after another five years of talks, which would then amount to a total of 60 years without tangible results for Turkey, or Ankara might perhaps call for a referendum on the issue.

Hard talk: Could the Visegrad Group, albeit unwittingly, become a catalyst for a more decentralized Europe? Could a free trade deal between the U.K. and Turkey create extra economic momentum? In other words: As Brexit is a go, will there be a new Europe? What I want to say is: Could four to five years down the line lead to a full-fledged Europe at various speeds, yet still under an EU umbrella? Would there be an inner core circle where everything is truly harmonized, from currency to a common government, plus a middle circle where political coops work but nation states remain sovereign? And then the transcontinental free trade zone yet with some binding legal standards?It seems books like Dinon's could very well stay in print for the foreseeable future, and Brexit will be featured prominently in any updated editions. However, said in all modesty to make my journalistic point, perhaps a slightly modified title could come in handy for all new generations of EU politics students: "From Ever Closer Union to Multispeed Europe — An Introduction to European Integration Past and Present." And let us hope that besides Brexit, one more additional chapter will have been inserted, too: "Enlargement and Turkey's successful EU Membership Bid in Retrospective."

All of this has been written with the full knowledge that no one knows what the EU Turkey plans to join one day will actually look like.